As a landlord in Miami, Florida you need to keep up with rental market trends. Sometimes economic changes demand that you raise your rent price to keep up with the market. Other possible reasons for increasing your rent include:
- Paying for property maintenance
- Matching the current market rates
- Improving rental property living conditions
- Accommodating tax increases
- Increasing the ongoing cash flow
Raising the rent sounds pretty straightforward but in reality, it can be quite complicated. You will have to do your research and find out your legal requirements as a landlord. Making a mistake may result in the loss of good tenants, money, and time.
Are you ready to increase your return on investment in Miami real estate?
In this article, we will go over the main points you should know about increasing your rent cost in Florida.
How do you inform your tenants about the increase?
Before raising the rent, you need to provide your tenants with an official, written notice. This notice needs to answer the following questions:
- How much will the rent increase?
- When will the rent increase come into effect?
There is not a specific clause in Florida laws that specifies how much notice you need to give. The recommended course of action to take is to follow the rules of notice for terminating a lease. These state that you have to give your tenant 15 days of notice when terminating a monthly lease. In the case of a yearly lease, you have to give a notice of 60 days.
Legal notice of an increase in rent in Florida.
Florida Landlord-Tenant Laws state that the notice has to be written. You can either send it by mail or deliver it in person to your tenant.
How much can a landlord raise rent?
Florida does not have limits on rent increases. As a landlord, you can raise the rent as much as you want. It is important, however, that you consider the consequences of charging too much or too little:
- If you charge too much, you might lose your current tenants. The process of finding new tenants may take a considerable amount of time, and you will face a higher turnover rate and longer vacancies. This situation can hurt your rental business.
- If you charge too little, you risk damaging your cash flow. Your return on investment will enter a suboptimal state. Potential tenants may be suspicious of prices that are a lot lower than the market average. They may avoid renting from you because of this.
You should pick a similar amount to other rental properties in the neighborhood. Do your research on the market by checking nearby rental prices online.
Some local laws may prohibit you from increasing your rent. For example, rent control or stabilization laws. Always check with the local officials before you increase the price.
Is it legal to increase rent?
Under Florida laws, landlords cannot increase rent for discriminatory or retaliatory reasons. It is always a good idea to document why you are raising the rent. This will help you in case of potential conflicts with tenants.
- Discrimination. You have to treat all your renters on an equal basis. Discrimination takes place when you treat someone differently based on their unique characteristics. These include the following: disability, familial status, gender, national origin, race, and religion. They also include unfavorable military discharge, skin color, ancestry, or sexual orientation.
- Retaliation. You cannot increase the rent of your rental property as an act of retaliation. Your renter may report code violations or form a tenant’s rights organization. In cases like this, you are not allowed to raise the rent, harass the tenant, or evict them.
Does the rent increase impact security deposit limits?
Florida statutes do not limit the amount you can charge as a security deposit.
In most cases, raising the rent price means you have a legal basis for raising the security deposit as well. In most cases, your security deposit cost should be a multiple, such as double, of your monthly rent price.
For example, if your rent was $900 and now it is increased to $1,200. The previous security deposit was $1,800 but after the rent increase, you could raise it to $2,400. Check your local laws to see the exact security deposit limits in your area.
Can your tenants reject the rent increase?
Yes. Your tenant could reject the price increase and agree to move out after their lease ends. Until then, they can remain in the rental unit and continue paying rent at their current price.
The bottom line: Florida rent increase laws
Increasing rent is necessary to keep up with the rental market. You must follow Florida state and federal laws to ensure that your rent increase is lawful. Such laws will require that you:
- Provide your tenant with written notice of the rent increase
- Do not increase the rent for discriminatory or retaliatory reasons
- Raise your security deposit charge on a legal basis
- Are aware that your tenant can reject the rent increase
- Understand that there are no limits on rent increase (but you should aim not to charge too much or too little)
- Check your local laws on rent control or stabilization
If this seems overwhelming, you can hire Income Realty Corporation to take care of this matter for you. Give us a call at (305) 251-5561 for more information.